TRA - Turners Automotive Group [previously TNR - Turners Limited]

[Beagle]

TRA are really going to need that property gain from that sale in September is my read on this. Expect them to account for this above the line as normal operating profit, (selling second hand land is just like selling second hand cars right ) and try and hide and bury the fact that this is an extraordinary item very deep in the fine print of the notes. My guess, without this gain I'd say they'll be in the region of 11-12 cps normal earnings

[winner69]

Heartland talked a lot about increased bad debt expense

Have Turners started using IFRS9 accounting standards yet?

[percy]

TRA are really going to need that property gain from that sale in September is my read on this. Expect them to account for this above the line as normal operating profit, (selling second hand land is just like selling second hand cars right ) and try and hide and bury the fact that this is an extraordinary item very deep in the fine print of the notes. My guess, without this gain I'd say they'll be in the region of 11-12 cps normal earnings

As I take it Turners business model includes property ownership,development etc.A very important part,especially when we think ahead of very large intended developments in both Auckland and Christchurch.
Property,
Vehicle sales.
Vehicle insurance.
Vehicle finance.
Vehicle service.
End of life vehicle services.
CE Credit.
A very clever fully vertically intregated business model, which is gaining momentum.

[winner69]

TRA are really going to need that property gain from that sale in September is my read on this. Expect them to account for this above the line as normal operating profit, (selling second hand land is just like selling second hand cars right ) and try and hide and bury the fact that this is an extraordinary item very deep in the fine print of the notes. My guess, without this gain I'd say they'll be in the region of 11-12 cps normal earnings

H118 had $0.9m of property related things in revenues ...so will need to do better to make an impact this half.

I feel a lot of “normalising” coming on .....that’s painful.

[Beagle]

H118 had $0.9m of property related things in revenues ...so will need to do better to make an impact this half.

I feel a lot of “normalising” coming on .....that’s painful.

Snoopy is licking his snout in anticipation of having a field day lol

[winner69]

So, while we are all sitting around and some might even bite fingernails in expectation of the great revelations next week, and while some people obviously can't stand the excitement and prefer to sell out - question is, what does the market expect?

So far I would expect a similar EPS than last year (maybe slightly lower) - say 13 cents for the first HY, an indication that the second half will be better (it always is) and (hopefully) on top of that some one off property gains, which percy thankfully brought to our attention.

On the other hand - if that's what the markets expect, than I don't understand the price trend ... somebody here must be really pessimistic.

So - what do you guys think, what would be in your view a really good HY result pushing the SP above the $3 (in my view something above 15 cents EPS without one offs) - and what would be a really terrible result (worse than the disaster the market seems to price in anyway? What do you think it will be?

My magic spreadsheet comes up with H1 NPBT of $17m and NPAT of $12.2m or 13.7 cents per share (they’ll report 14 cents plus on a weighted average number of shares)

The good news is that there HAS to be a lift in guidance to something like $37m to $40m NPBT or else things just don’t make sense - based on past financials and all the good things they’ve said of late. If their strategy was to under promise and over deliver it has backfired big time eh and Hunter deserves more of a beat up than Hrdlicker is getting from you guys.

I’m going to take a (smallish) punt .....should make 20% / 25% pretty quickly I reckon ...I have faith in my magic spreadsheet ....the only risk is that Baker, Hunter et al (the company) has pissed the market off so much they might just continue to give Turners the fingers and say so what. Once a market pariah in most cases always a market pariah.

Can’t wait until next Tuesday ...bring it on

[Beagle]

If it looks like a dog (share price), barks like a dog (keeps talking the talk but the share price keeps going down), requires feeding on a regular basis like a dog (capital raisings), has fleas like a dog, (Chairman can't be bothered turning up to the annual meeting) guess what, its a dog ! No point in getting dividends if its matched by SP declines. Might be time to clean out the kennel if we don't see some genuine form at the next dog trials in the very near future.
The market is telling us next weeks results will be anything but joyous barking.

My magic spreadsheet comes up with H1 NPBT of $17m and NPAT of $12.2m or 13.7 cents per share (they’ll report 14 cents plus on a weighted average number of shares)

The good news is that there HAS to be a lift in guidance to something like $37m to $40m NPBT or else things just don’t make sense - based on past financials and all the good things they’ve said of late. If their strategy was to under promise and over deliver it has backfired big time eh and Hunter deserves more of a beat up than Hrdlicker is getting from you guys.

I’m going to take a (smallish) punt .....should make 20% / 25% pretty quickly I reckon ...I have faith in my magic spreadsheet ....the only risk is that Baker, Hunter et al (the company) has pissed the market off so much they might just continue to give Turners the fingers and say so what. Once a market pariah in most cases always a market pariah.

Can’t wait until next Tuesday ...bring it on

Had you pegged more of a horse racing punter...you must like betting on the dogs as well I have a small stake left and a steel capped boot on ready to kick it out of the kennel if it doesn't bark soon.

[winner69]

Had you pegged more of a horse racing punter...you must like betting on the dogs as well I have a small stake left and a steel capped boot on ready to kick it out of the kennel if it doesn't bark soon.

Punting on dogs a no no ....you don’t which ones have been given a drink of water before the race ....and too many get ‘retired’ as they say in the game, a sport that should be banned.

Greyhounds (the ones that get genuinely retired) make great pets.

Report - In the three racing seasons from 2014 to 2017, at least 1300 dogs were euthanised and 1271 were unaccounted for (probably euthanised as well).

[Snoopy]

Maybe the share price is just drifting down to match the company’s book value of $2.52

Could be as Turners don’t make much of a return on total invested capital

and i’ll leave it to Snoops to discuss goodwill

Getting close to Winner's 'book value'.

I am not sure of the best way of calculating 'Return on Total Invested Capital'. I pulled this formula off the net.

'Return on Total Invested Capital' = (Net income - Dividends) / (Debt + Equity)

'Net Income' here represents 'Net Operational Income'. Don't count 'foreign exchange gains' and 'the sale of business units'. Dividends are removed from the calculation, because they are 'paid out' and not reinvested. However, I am struggling to see the value in such a calculation. Every shareholder is entitled to the dividend. So what is the purpose of a 'valuation calculation' that removes the principal 'compulsory benefit' of TRA share ownership?

SNOOPY

[Snoopy]

So - what do you guys think, what would be in your view a really good HY result pushing the SP above the $3 (in my view something above 15 cents EPS without one offs) - and what would be a really terrible result (worse than the disaster the market seems to price in anyway?) What do you think it will be?

I think shareholders should pay little attention to the half year numbers. Much more important will be how the big picture is developing. Is 'Autosure' getting traction? Are bad debts really reducing as management hoped? Is market share holding up? How is the 'securitization of loans' going? These are the kind of things I will be looking to find out!

SNOOPY